Category: Volume 20 Issue 1

The Effects of Regulatory Change on Taxpayer Compliance Behaviour in the Building and Construction Industry

Abstract

Using the results from a comprehensive telephone survey of home builders during 2007-8 and 2014-15, we provide an analysis of the behaviour, characteristics and perceptions of cash economy activity in the building and construction sector in Australia. In 2012-13, the ATO introduced the Taxable Payment Reporting System which yielded an additional compliance dividend. By comparing responses of builders before and after the introduction of this reporting system, we evaluate the impact of this regulatory change on grassroots activity in the cash economy. Although this regulatory change has impacted on certain cash economy activities, more targeted strategies are still required.

DOWNLOAD THE ARTICLE

THE IMPACT OF THE CHANGING TECHNOLOGY OF MOTOR VEHICLES ON ROAD TAX REVENUE

Abstract
This paper considers the impact on road tax revenue of changes in the technology of motor vehicles. As the drive trains of motor vehicles are transformed from internal combustion engines to electric motors, their energy sources may transition significantly from taxable fossilfueltonon-taxablerenewableenergy. Revenuefrommotorvehiclefuelexciseslevied on petroleum products and allocated to the construction and maintenance of Australia’s roadways will decrease accordingly. Therefore, to continue to fund the road transport infrastructure, governments will be obliged to change their focus about how road tax revenue is raised. This paper considers the current number of electric vehicles (EVs) on Australian roads and attempts to predict the future uptake of EVs by road users up to the year 2035. It looks at the likely impact of reduced road tax revenue from motor vehicle fuel excises on future contributions by the Australian government for the construction and maintenance of Australian roadways. To that end, the paper examines data published by the Australian Bureau of Statistics (ABS) and statistics from the Australian Taxation Office (ATO). It also refers to sales data provided by motor vehicle manufacturers. It then compares the results of those examinations with data from a case study of a plug-in hybrid electric vehicle (PHEV) owned and operated by a solar project in rural Western Australia. The paper concludes that future revenue from fuel excises may decrease as a consequence of the introduction of EVs. However, as there has not been an official link between road tax revenue and road construction and maintenance expenditures since 1959, a reduction in road tax revenue will not necessarily affect funding for the construction and maintenance of Australian roadways.

DOWNLOAD THE ARTICLE

The Effectiveness of Part IVA of the ​Income Tax Assessment Act 1936 ​(Cth): Time for a ‘Not merely incidental’ purpose test?

Abstract

This article examines whether Part IVA of the ​Income Tax Assessment Act 1936 has been effective in preventing tax avoidance. It argues that the effective operation of the Part IVA anti-avoidance test turns on whether it can catch a scheme which has been entered into for the dominant purpose of a tax benefit. Drawing on case studies, it concludes that Part IVA has been effective, owing to the use of a counterfactual in determining whether there was a reasonable alternative postulate for the scheme in question and the section 177D(2) multifactorial test to determine the purpose of the scheme. However, this article argues that increasingly sophisticated ways of avoiding tax necessitate extension of the dominant purpose test to include any scheme where there is a collateral purpose of a tax benefit, even where the scheme was entered into primarily for commercial benefit.

DOWNLOAD THE ARTICLE